Despite experiencing weaker market conditions this year, Bomag made the biggest single investment in his history during 2013 in the form of its new 12,600m2 drum manufacturing facility at its headquarters in Boppard, Germany, which cost €22.5 million to build.
Manufacturing at the new drum factory started in June. Meanwhile, Bomag also finished its new logistics facility this year – a state-of-the art warehouse which stocks 45,000 items, deals with 500 to 700 orders a day, and is said to boast 96% parts availability.
On top of this, the company has also launched a string of new products for the road building sector since the start of 2013, including a wealth of new launches at the Bauma exhibition in Munich, Germany, which took place in April.
Most recently, it introduced the 1m width BM1000 milling machine at its 2013 Asphalt Days customer event in the first week of September – the latest in a line of new milling machines.
The BM1000 is a 350hp (257kW), Tier 4 Final/Stage IV-compliant machine that it claims is not only the most powerful in its class, but is also said to boast lower noise and vibration.
The BM1000 features the company’s BM515 tool holder system for easy maintenance and is available with a seat for the operator, in contrast to competitive models where the operator must stand.
In addition to the BM1000, Bomag also launched two new, Tier 4 Final/Stage IV-compliant asphalt pavers at its customer event – the BF600-2 and BF700-2. These are 17 to 20 tonne class machines that are available with either wheels or tracks.
A key feature is the Magmalife screed heating system. The heating elements are cast in an aluminium block which is said to make them robust and durable and also reduce heat-up times to 20 to 30 minutes. Bomag says this represents a saving of up to 25% compared to competitor machines.
The company also showcased examples from its new -5 Series of articulated tandem rollers. The 10 to 11 tonne class BW 161 ADO, BW 161 AD-5 and BW 190 models were in action – machines which offer three different compaction systems; double vibration, oscillation and Asphalt Manager 2 (AM2).
Double vibration has two amplitudes for compacting thick or thin layers, while the oscillation system produces less vibration but still achieves efficient compaction and is said to be better suited for use on bridges and working close to buildings.
The AM2 system combines measuring technology and compaction control, automatically controlling the machine to avoid unnecessary passes.
All these new launches are part of Bomag’s effort to turn up the heat on its competition in Germany and abroad, according to company president Jörg Unger.
“We are pushing to become a true full-line road building equipment manufacturer with products covering asphalt production through the Marini brand, which like Bomag is also owned by Fayat, as well as our own road construction, road maintenance, and finally road reclamation and recycling equipment,” Mr Unger said.
“It will be a tough fight, but Bomag wants to be a strong number two in the road building market. Since we started producing milling machines, in the last 24 months we have won a nearly 30% market share. Our customers have told us that the competition has had the monopoly on price, and that they find the lack of an alternative hard,” he added.
Head of marketing Jonathan Stringham agreed, “A monopolistic market is not to a customer’s benefit. The competition dropped its prices by around 40% since the introduction of the BM500 milling machine in 2011, and we feel that we are therefore increasing the competitiveness of technologically advanced equipment like this.”
However, Mr Unger was keen to highlight the fact that Bomag was not interested in entering a price war. “We have a lot of respect for the German competition,” he said. “It is also not important to us from which competitor the market share comes, but that we get the market share.”
Mr Unger said the company had limited expectations for the demand this year, but instead of standing still, it had made the decision to invest in the company to position itself for the future.
In February, for instance, Bomag’s parent company, Fayat, acquired Terex’s Cedarapids-branded pavers and material transfer machines in North America, and its CMI-branded reclaimer/stabiliser product lines, which are all manufactured in Oklahoma City, US. In addition, it also bought Terex’s entire road building equipment operations in Brazil, which are located in Porto Alegre and manufacture mainly asphalt plants and pavers.
“The financial year 2013, which for us ends in September, has been weaker than 2012,” Mr Unger explained. “Both Bomag and Fayat’s expectations for the market were limited, and we forecast a small decrease in turnover this year for Bomag to €560 million.
“But we have invested a lot during the year – we want to position Bomag’s road building segment for the future. There is also palpable optimism for the market in 2014, and we do think there will be more momentum next year,” he explained.